- Email: [email protected]
On The Economic Side
JOURNAL OF' THE AMERICAN PHARMACEUTICAL ASSOCIATION
.......- - -·- - -on the 4 CONOMIC SIDE- - - - - Sales Volume Up The Monthly Retail Trade Report of the U.S. Department of Commerce shows that estimated drug stores sales for the first six months of 1955 were 4 per cent above sales for the similar period in 1954. Estimated increases for other types of retail businesses were as follows: grocery stores 5 per cent; department stores, 6 per cent; variety stores, 8 per cent; family clothing stores, 10 per cent; shoe stores, 12 per cent; furniture stores, 18 per cent; motor vehicle dealers, 20 per cent. The percentage increase in sales of all retail stores for the sixmonth period was 8 per cent. These figures reveal that drug store sales have not been keeping pace with the increases in other types of retail establishments. There may be two underlying reasons for this situp.tion. Most areas of the nation have not had any major epidemics thus far in 1955. Another significant factor is is the continued encroachment of non-drug outlets in the sale of various health items.
some 300,000 food stores of the nation stock these items and many of them feature selfservice displays. These figures indicate that non-pharmaceutically trained personnel is selling remedies, many of which are potentially dangerous, to the public on a large scale. An E. 1. Du Pont Co. survey of 5,338 super market shoppers showed that 71.5% of drug and toiletries purchases resulted from impulse buying.
Failures Among Pharmacies According to Dun and Bradstreet, Inc., there were 161 retail drug store failures in 1954 with total liabilities of $4,839,000, an average of about $30,000 per store. There were 123 fa~lures in the previous year. During the period 1944- 1948, total failures numbered 50 or less per year. There were 12 failures in 1945, 591 in 1935. Statistics for 1953 reveal that 52.4 per cent of the failures were among pharmacies that had been in existence four years or less.
Delivery Costs
Prescription Survey
The cost of delivery service is often camouflaged by the fact that the expense item, "delivery expense," in the profit and loss statement does not include wages. The wages of deliverymen are included in the general expense item of "employees' wages" and hence one does not always get a true picture from the profit and loss statement. It would seem advisable for pharmacy proprietors to allocate wage costs into their proper categories in order to know the exact cost of delivery service. This point is brought home by the fact that the 1954 Lilly Digest shows an average cost of delivery of 0.4 per cent of sales; the 1954 survey conducted by the American College of Apothecaries gives an average of 1.1 per cent.
Professor Joseph H. Goodness, director of the Division of Pharmaceutical Administration at the Massachusetts College of Pharmacy, has come up with interesting findings in connection with a survey of 10,800 new prescriptions filled by 182 retail pharmacies in Massachusetts. His survey shows that the "average" pharmacy in Massachusetts in 1954 filled prescriptions written by 51 physicians. The range in the 182 drug store sample extended from a low of 5 to a high of 226 physicians. The modal, or most common number of doctors, was 40 and the median or middle-of-the-list number was 44 doctors. The Goodness report also points out that in the past 15 years there has been a shift of the week end peak for new prescriptions from Saturday to Friday and this is attributed to; the changing pattern of American life. Mondays and Fridays now represent the two peak periods of the week in Massachusetts. In the sample of nearly 11,000 new precriptions, it was found that 72 per cent of the total were filled on the same day as written and 16 per cent were one day old at the time of dispensing by the pharmacist.
Non-Drug Outlet Sales The 1954 Nielsen Report to retail drug and proprietary stores indicates that 89 per cent of the nation's food stores stock headache remedies, 81 per cent stock laxatives, and 77 per cent stock cold remedies. This means that 538
Vol. XVI, No.9
.......- - -·- - -on the 4 CONOMIC SIDE- - - - - Sales Volume Up The Monthly Retail Trade Report of the U.S. Department of Commerce shows that estimated drug stores sales for the first six months of 1955 were 4 per cent above sales for the similar period in 1954. Estimated increases for other types of retail businesses were as follows: grocery stores 5 per cent; department stores, 6 per cent; variety stores, 8 per cent; family clothing stores, 10 per cent; shoe stores, 12 per cent; furniture stores, 18 per cent; motor vehicle dealers, 20 per cent. The percentage increase in sales of all retail stores for the sixmonth period was 8 per cent. These figures reveal that drug store sales have not been keeping pace with the increases in other types of retail establishments. There may be two underlying reasons for this situp.tion. Most areas of the nation have not had any major epidemics thus far in 1955. Another significant factor is is the continued encroachment of non-drug outlets in the sale of various health items.
some 300,000 food stores of the nation stock these items and many of them feature selfservice displays. These figures indicate that non-pharmaceutically trained personnel is selling remedies, many of which are potentially dangerous, to the public on a large scale. An E. 1. Du Pont Co. survey of 5,338 super market shoppers showed that 71.5% of drug and toiletries purchases resulted from impulse buying.
Failures Among Pharmacies According to Dun and Bradstreet, Inc., there were 161 retail drug store failures in 1954 with total liabilities of $4,839,000, an average of about $30,000 per store. There were 123 fa~lures in the previous year. During the period 1944- 1948, total failures numbered 50 or less per year. There were 12 failures in 1945, 591 in 1935. Statistics for 1953 reveal that 52.4 per cent of the failures were among pharmacies that had been in existence four years or less.
Delivery Costs
Prescription Survey
The cost of delivery service is often camouflaged by the fact that the expense item, "delivery expense," in the profit and loss statement does not include wages. The wages of deliverymen are included in the general expense item of "employees' wages" and hence one does not always get a true picture from the profit and loss statement. It would seem advisable for pharmacy proprietors to allocate wage costs into their proper categories in order to know the exact cost of delivery service. This point is brought home by the fact that the 1954 Lilly Digest shows an average cost of delivery of 0.4 per cent of sales; the 1954 survey conducted by the American College of Apothecaries gives an average of 1.1 per cent.
Professor Joseph H. Goodness, director of the Division of Pharmaceutical Administration at the Massachusetts College of Pharmacy, has come up with interesting findings in connection with a survey of 10,800 new prescriptions filled by 182 retail pharmacies in Massachusetts. His survey shows that the "average" pharmacy in Massachusetts in 1954 filled prescriptions written by 51 physicians. The range in the 182 drug store sample extended from a low of 5 to a high of 226 physicians. The modal, or most common number of doctors, was 40 and the median or middle-of-the-list number was 44 doctors. The Goodness report also points out that in the past 15 years there has been a shift of the week end peak for new prescriptions from Saturday to Friday and this is attributed to; the changing pattern of American life. Mondays and Fridays now represent the two peak periods of the week in Massachusetts. In the sample of nearly 11,000 new precriptions, it was found that 72 per cent of the total were filled on the same day as written and 16 per cent were one day old at the time of dispensing by the pharmacist.
Non-Drug Outlet Sales The 1954 Nielsen Report to retail drug and proprietary stores indicates that 89 per cent of the nation's food stores stock headache remedies, 81 per cent stock laxatives, and 77 per cent stock cold remedies. This means that 538
Vol. XVI, No.9